Eco-financing Becoming Trend among Japanese Financial Institutions

An environmental non-governmental organization (NGO), called "A SEED Japan" (Action for Solidarity, Equality, and Environment and Development), released on January 9, 2012, the results of its survey on the corporate social responsibility activities of Japanese financial institutions. The survey, conducted in October 2011, garnered responses from 29 of 192 Japanese financial institutions contacted, including major city banks, regional banks, labor banks and major credit unions (credit unions with total assets over 500 billion yen, or about U.S.$6.4 billion).

In the survey category about efforts on environmental issues, many respondents named their programs and also provided quantitative information about their implementation. In their efforts on investments and loans favoring eco-friendly companies (e.g., firms with ISO 14000 certification for environmental management systems), many financial organizations, including local banks and credit unions, said they are expanding their efforts. In the category on investments and loans for environmental activities, all three major Japanese banking groups (Mitsubishi UFJ Financial Group, Mizuho Financial Group, and Sumitomo Mitsui Financial Group) said they promote project financing for environmental businesses.

Regarding their efforts on regional economic development, the survey shows a wide variety of answers among the regional banks, which indicated that between 45 and 90 percent of their loans were within the same region. This ratio of the circulation of funds locally is an indicator to measure regional contributions.

On their efforts to provide support to social enterprises, the labor banks showed the best results in providing investments and loans to non-profit organizations. Also, the major bank groups and regional banks said they promote the creation of investment for microfinance organizations and the fostering of social entrepreneurs.

Posted: 2012/05/14 06:00:15 AM